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Average pensioner needs £12k per year, much more than State Pension

Paloma Kubiak
Written By:
Paloma Kubiak
Posted:
Updated:
27/05/2016

The average cost of being a pensioner is nearly £12,000 a year, which is £400 more than the amount needed in 2015, research shows.

Spending on basics such as food, travel and energy totals £223 per week, meaning the average pensioner needs £11,620 a year in retirement.

The annual cost is up by about 3.75%, the equivalent of £420 a year or £8 a week more, according to Keyretirement.com’s analysis of government figures on household expenditure.

However its research shows that the average cost has actually fallen for those living in Northern Ireland and the West Midlands, while the figure remains largely unchanged in London and the South East.

There are huge regional variations with retired people needing £9,990 a year compared with £13,270 in the South East, about £3,280 a year less or 25% lower.

See the table below for the average costs for pensioners in different regions:

YMoney Pensioner'sCostTable

KeyRetirement.com, an over-55s financial provider, also found the average retired household spend around 14% of their cash on fuel and housing – about £1,630 a year – while 13% or £1,560, goes on food and non-alcoholic drinks.

Around 16% of a retired household’s budget is spent on recreation, that’s about £1,830 a year.

Dean Mirfin, technical director at Keyretirement.com, said: “The basic cost of being a pensioner at around £11,620 a year underlines the need for extra income which is well in excess of the basic State Pension.”